China depends on counterfeiting black market---they violate western IP laws to grow upwards.
Fleming 2015, Daniel C. Fleming is a litigator who has taken over 100 cases to jury verdict his experience is wide-ranging and includes products liability, commercial disputes, employment litigation, civil rights, bankruptcy, and even international parental child abduction. (Daniel C. Fleming, 04/15, “Counterfeiting in China,” Wong Fleming, accessed 07/25/2024. https://www.wongfleming.com/wpcontent/uploads/COUNTERFEITING-IN-CHINA.html#:~:text=A%20significant%20portion%20of%20its,5%20million%20people%20in%20China.) KA
From the perspective of U.S. firms, China’s entrance into the WTO has been a double-edged sword. Since China’s accession, its economy has grown anywhere between 6-13% annually, as measured by percent change in gross domestic product, thereby making it very attractive for foreign firms to conduct their business there. However, China is also home to a thriving black market. A significant portion of its economy is based on counterfeiting and the violation of most intellectual property laws found in the western hemisphere.
It will not be easy to eradicate counterfeiting in China without hurting the domestic economy. Piracy employs both directly and indirectly 3 to 5 million people in China. Recent estimates place the market value of counterfeit goods upwards of $25 billion annually. It is so pervasive that companies established by local governments operate as some of the 40,000 outlets nationwide for these fake goods. Many of the most flagrant brand violators are state enterprises and run by the same governments that should be policing them.